A positive cis-acting DNA element in the near 5'-upstream region of the CYP2B1/B2 genes in rat liver was found to play an important role in the transcription of these genes. An oligonucleotide covering -69 to -98 nt mimicked the gel mobility shift pattern given by the fragment -179 to +29 nt, which was earlier found adequate to confer the regulatory features of this gene. Two major complexes were seen, of which the slower and faster moving complexes became intense under uninduced and Phenobarbitone-induced conditions respectively. Minigene cloned DNA plasmid covering -179 to +181 nt in pUC 19 and Bal 31 mutants derived from this parent were transcribed in whole nuclei and cell free transcription extracts and mutants containing only upto -75 nt of the upstream were poorly transcribed. Transcription extracts from phenobarbitone-injected rat liver nuclei were significantly more active than extracts from uninduced rats in transcribing the minigene constructs. Addition of the oligonucleotide (-69 to -98nt) specifically inhibited the transcription of the minigene construct (-179 to +181 nt) in the cell free transcription system. It is therefore, concluded that the region -69 to -98 nt acts as a positive cis-acting element in the transcription of the CYP2B1/B2 genes and in mediating the inductive effects of phenobarbitone.